BY JOHN HOUANIHAU
The Government has terminated all Memoranda of Understanding (MoUs) relating to tax exemptions in the mining, forestry and fisheries sectors with immediate effect, with the aim to strengthen fiscal management and protect public revenue.
Minister of Finance and Treasury, Gordon Darcy Lilo, announced the decision, saying that all fiscal arrangements previously covered under such agreements will no longer be recognised.
In a statement yesterday, the Ministry of Finance and Treasury said the move intends to close fiscal loopholes and ensure that all tax exemptions are granted in accordance with existing laws.
The Ministry clarified that under current legislation, the authority to approve tax exemptions rests solely with the Revenue and Customs Exemption Committee.
While the Minister may have signed some MoUs in the past, the Ministry noted that he does not have the legal authority to approve tax exemptions outside the established statutory process.
“Any fiscal arrangements previously covered under MoUs will no longer be recognised,” Minister Lilo said.
The Ministry has directed all companies operating in the resource sector to comply with existing legislation and regulations. Businesses seeking tax exemptions must now submit their applications through the Revenue and Customs Exemption Committee for consideration.
According to the Ministry, the decision will enhance transparency and accountability in the administration of tax exemptions while ensuring that all investors are treated fairly under the law.
The Government said the measure forms part of broader efforts to strengthen fiscal discipline, safeguard state revenue and promote a level playing field for investors operating in Solomon Islands.
The termination takes effect immediately and applies to all existing MoUs relating to tax exemption arrangements in the mining, forestry and fisheries sectors.
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